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Pension and WP charges &#39better value than ever&#39

Charges on with-profits bonds and personal pensions represent better value than ever, according to research by consultants Tillinghast-Towers Perrin for the ABI.

Using information app-earing in the FSA&#39s league tables, the survey says char-ges on pension products have fallen to the same level as those on tracker Isas while over a 10-year period, with-profits and unit-linked bonds are significantly chea-per than actively managed Isas and unit trusts.

The research adds that in the short term, endowments designed for savings or mortgage repayment have relatively high reductions in yield and they are much closer to those for Isas and unit trusts over a 25-year term.

ABI head of life and pensions Alan Woods says: “This shows how many life insurance savings and pension plans now have highly competitive and flexible charging structures. Typ-ical charges on pensions and investment bonds are below those of actively managed unit trusts or Isas.”

Threadneedle director of communications Richard Eats says: “One product allows for the cost of advice to be paid to the intermediary and one does not. It is like comparing a kit car with a ready-made model. You can build the car from scratch if you want.”

The Investment Mana-gers&#39 Association says it cannot comment until it has studied the document.

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